EU sunflower oil prices fell to 3-year lows as soybean oil prices fell

2024-03-01 11:21:26
Machine translation
EU sunflower oil prices fell to 3-year lows as soybean oil prices fell

Against the background of active supplies of sunflower oil to the EU, its prices in European ports fell to a 3-year low, but this did not lead to increased demand. At the same time, the prices of rapeseed oil became higher than those of sunflower oil for the first time, due to the high demand for biofuel, - reports Agricensus.


The blockade of Black Sea ports in Ukraine, tension in the Red Sea and difficulties in the operation of alternative routes led to the fact that large volumes of sunflower oil entered the EU market at very low prices. However, this does not increase the demand for oil, as the EU market is already oversupplied.


Another consequence of the supply of cheap sunflower oil from Ukraine to the EU was a reduction in soybean and palm oil imports. According to the European Commission, from July 2023 the import of sunflower oil to the EU increased by 30% to 1.6 million tons compared to the same period of the previous season, with the share of supplies from Ukraine in this import increasing from 89.7% in 2023 to 92.6% in 2024


According to Agricensus, sunflower oil prices for Q2 2024 delivery at 6 EU ports fell from €845 or $915/t to €831/t or $900/t FOB, the lowest level since September 2020, when the price was $855/t FOB.


Despite low demand for sunflower oil due to oversupply, sunflower prices in the EU remain quite high. According to the FEDIOL association, during the 5 months of 2023/24, sunflower transshipment in the EU increased by 9% compared to the previous season to 2.4 million tons, in particular, in January it was the highest since October 2021, 571 thousand tons.


According to the USDA forecast, in 2023/24 the import of sunflower oil to the EU will reach a 10-year maximum of 2.35 million tons.


Rapeseed oil prices remain high despite lower sunflower oil prices. They are supported by stable demand from biodiesel producers, a reduction in canola processing in favor of soybeans, and curbing sales of canola by farmers.


According to FEDIOL, from November to January, the average monthly volume of rapeseed processing in the EU reached an almost record 1.73-1.79 million tons.


Rapeseed oil for March delivery is being offered at €890/t FOB Rotterdam, and at €875/t FOB April, while asking prices are €855 and €850/t, respectively, Agricensus reports.


Soybean oil lost value relative to other oils as some major refiners ramped up soybean processing amid strong US demand for soybean biodiesel. The volumes of soybean processing in the EU in December - January reached a 5-month maximum of 1.17 million tons. At the same time, soybean oil prices from October 2023 fell by more than 25% to €850/t FCA Hamburg.

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